Jan. 7 (Bloomberg) -- Japan and India moved to expand air
force ties before Prime Minister Shinzo Abe visits New Delhi in
a few weeks, bolstering relations two months after China
declared an air-defense identification zone in a disputed area.

Japan’s Defense Minister Itsunori Onodera and his Indian
counterpart A.K. Antony discussed starting talks between air
force officials while reaffirming plans to conduct regular naval
exercises, according to an Indian government statement
yesterday. Asia’s second- and third-largest economies may also
conduct pilot exchanges, it said.

“Both sides know that China stands between them and that
they’d be smart to make sure they’re on the same page with each
other now and in the future,” said C. Uday Bhaskar, an analyst
with the New Delhi-based National Maritime Foundation who spent
37 years in the Indian Navy. “They’re taking steps, small
steps, but if there’s an inclusion of the air force now, then
you’re seeing growth in this relationship.”

Japan and India, which both have territorial disputes with
China, are increasing ties as tensions escalate in Northeast
Asia. China and South Korea rejected Abe’s call for talks
yesterday after his visit to a war shrine last week drew an
angry response from both countries.

Abe’s trip to India will be the first by a Japanese leader
since 2011, when the countries agreed to boost security ties in
the face of China’s growing assertiveness. Last month, Japanese
Emperor Akihito visited India for the first time in five
decades, and the nations’ navies conducted bilateral training
exercises for the second time in as many years.

$50 Billion

The countries last month also increased financial ties,
with India approving an increase in the bilateral currency swap
arrangement between the Reserve Bank of India and the Bank of
Japan to $50 billion from $15 billion.

The ministers “decided to strengthen India-Japan defense
consultation and cooperation, including those related to
maritime security,” the government said in yesterday’s
statement. Indian naval vessels will visit Japan to conduct
exercises this year, it said.

China in November unnerved its neighbors by declaring an
air defense identification zone in the East China Sea that
overlaps with Japan’s zone and includes uninhabited islands
claimed by both nations. China’s move “unjustly infringes on
freedom of flight over the high seas,” Abe told reporters on
Dec. 14 following a Tokyo summit with the 10 members of the
Association of Southeast Asian Nations.

Abe’s Dec. 26 visit to a shrine that honors wartime leaders
-- the first by a sitting prime minister since 2006 -- further
exacerbated relations with Asia’s biggest economy. Abe’s visit
to Yasukuni Shrine had closed the door to dialogue with China
because he disregarded the opposition of the Chinese people,
Foreign Ministry spokeswoman Hua Chunying said in Beijing
yesterday.

An April military standoff between China and India marked
the most serious incident between the nuclear-armed neighbors in
a quarter of a century on the Himalayan border where the world’s
most-populous countries fought a brief war in 1962.